A trading favorite with index futures traders, the Mini Dow is one of the newest members among Emini contracts having been introduced a few years after the S&P 500 Emini and the Nasdaq Emini. However, don’t let this fact fool you into believing it is not on par with it’s cousins. This contract is an excellent trading instrument employed by many experienced traders because of it’s liquidity and excellent trading volatility. The Dow Emini is used by both futures day traders and emini scalpers providing superior results for skilled tacticians.

Anatomy Of The Dow Emini Contract (YM)The Mini Dow futures track the Dow Jones Index or the cash market as it is called by many traders. All Dow Emini future contracts have expiration dates set at some point in the future, hence the name futures. Every emini future has two letters to identify them as a futures contract and in the case of the Dow Emini, it’s two letter designation is YM. Depending on which contract you purchase, all YM contracts have expiration dates four times during the course of the year. The designated expiration dates for individual contracts are March, June, September and December.

YM Emini Futures - The "Fun" Contract
For clarity, if you are new to YM futures trading, each month has it’s own letter identifying the month it is set to expire. March is the letter H. June is the letter M. September is the letter U and December is identified by the letter Z. For example: If a Dow Emini contract were bought that was set to expire in December 2012, the identifier for this futures contract would be YMZ12. YM identifies what type of futures contract; 12 tells what year it will expire (2012) and Z reveals in which month it will expire. In this case, December is the expiration month.

Emini futures move in ticks or points. For each tick up or down, the value of the contract changes. For the YM emini, each tick is worth $5. If you bought a YMZ12 at 10610 and sold it later in the trading session at 10630, you would have gained 20 ticks or points with a profit of $100. Unlike it’s cousins, the ES and NQ, the YM emini does not trade in quarter ticks or points. It moves one entire point with each tick of the market and is quite fun to trade.

Mini Dow Trading Tactics

The YM Emini is an excellent trading instrument for traders seeking to use both traditional day trading and emini scalping methodologies. Because of their liquidity and volatility, many traders employ emini contracts exclusively, choosing them over stocks. What’s more, the YM can be traded using a variety of trading systems from traditional Japanese candlestick patterns, moving averages, pivot points and levels of support and resistance. Many believe the Dow Emini YM to be the best futures contract for beginners to learn with.